An original rendering from 2015 shows a pedestrian bridge connecting an upgraded arroyo to the Encanto low-income housing project. The building pictured has since been updated to include one story of retail and three stories of apartment units.

An original rendering from 2015 shows a pedestrian bridge connecting an upgraded arroyo to the Encanto low-income housing project. The building pictured has since been updated to include one story of retail and three stories of apartment units. (Courtesy/Studio E Architects)

The entitlements for a proposed low-income housing development — at the northeastern corner of Hilltop Drive and Euclid Avenue in Encanto — received unanimous approval from City Council members on Monday. That leaves money and a legal challenge the remaining items left to be settled before developer Affirmed Housing can break ground on the long-awaited mixed-use project.

First selected by Civic San Diego in June of 2016, Affirmed Housing’s Hilltop and Euclid project calls for 113 low-income apartment units, 8,485 square feet of commercial space and an upgraded arroyo open space with a pedestrian bridge. The firm’s partner on the project, Ito Gerard and Associates, was selected to develop the rest of the parcel with 20 market-rate single-family homes and 27 market-rate townhomes.

In February, the Hilltop and Euclid proposal secured the approbation of the Chollas Valley Planning Group; it received the city’s planning commission recommendation in November. Monday, City Council members raised no objections to OK’ing the latest development milestones, which included an addendum to the environmental impact report, a draft map and permits.

If all goes as planned, Affirmed Housing could begin construction on the subsidized apartment units in March 2020, project manager Jonathan Taylor told council members.

“We’ve been waiting for this for … decades. What we have right now is cement, concrete and dirt,” said Council President Myrtle Cole, who represents the district that includes Encanto. “(Hilltop and Euclid) will revitalize a vacant, blighted site.”

The low-income housing portion of the project, located on the eastern half of a vacant 9.38-acre parcel owned by the city, would create 14 studio apartments, 23 one-bedroom units, 37 two-bedroom units, 21 three-bedroom units and 18 four-bedroom units. All of the units, spread across four buildings, would be set aside for low income and very low income renters, with rates determined as a percentage of the area’s median income. A full-service restaurant and possible neighborhood coffee shop are planned for the first floor of the building at the intersection of Hilltop and Euclid.

Construction costs for the affordable housing and retail development are estimated at $43 million, not including the value of the land, which is being donated by the city. Next year, the developer will apply for around $25 million in low-income housing tax credits, Taylor said. Civic San Diego, the city’s planning agency for undeserved neighborhoods, has committed $6 million to the project. The developer has also applied for $8.5 million from the San Diego Housing Commission.

While the group still needs to finalize the project map and its street improvement plans, its only major obstacle is a lawsuit that seeks to thwart the development altogether.

In August, the watchdog group San Diegans for Open Government, led by attorney Cory Briggs, filed suit against Affirmed Housing, the City of San Diego and Civic San Diego, seeking to reverse previous approvals. That’s because Civic San Diego board member Phil Rath was fined by the city’s Ethics Commission for voting in favor of Affirmed Housing in 2016 to develop the project. He didn’t disclosing his financial relationship with the company at the time.

“We find it very unfortunate that Mr. Briggs has chosen to go after and delay an affordable housing and mixed-income/workforce development, a development that the local community has fully embraced and supports, as evidenced at today’s hearing with zero opponents,” said Jimmy Silverwood, Affirmed Housing’s vice president of acquisitions and development. “We find it disheartening that Mr. Briggs’ lawsuit may stall this much needed affordable housing while California is in a housing crisis.”

Briggs could not be reached for comment.

The case is ongoing with an initial hearing scheduled for early next year.

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